Wednesday, October 5, 2016

$50 Oil Is Not Enough To "Save" Saudi Arabia -- It Simply Slows The Pace Of Deterioration -- Analyst -- October 5, 2016

The first year of Prince Salman's new economic policy is not looking good -- Bloomberg/Rigzone.

Also, the July, 2016, data has just been released for:
It appears US crude oil imports from Saudi Arabia are simply enough to satisfy Saudi's refinery along the US gulf coast.

Seven New Permits -- October 5, 2016

Active rigs:

Active Rigs3267190183190

Wells coming off confidential list Thursday:
  • 32321, 1,026, Hess, EN-Freda-154-94-2635H-9, Alkali Creek, t9/16; cum 4K after 1 day of production;
Seven new permits:
  • Operators: XTO (5), QEP (2)
  • Fields: Lost Bridge (Dunn), Heart Butte (Dunn)
  • Comments: track the Lost Bridge oil field here; the Heart Butte field here. The fields might need updating. The five XTO permits are Jorgenson Federal 44 permits in section SESE 5-148-96 (see below); the two QEP permits are MHA permits in section swsw 4-149-91. [Later, XTO with four more permits on the same pad, or the same immediate area, the very next day, as the 5 new permits noted below.]
Again, no DUCs reported as being completed.


Note the location of the five new XTO Jorgenson Federal permits in Lost Bridge oil field:

Slowest Recovery Since WWII -- CNN -- October 5, 2016

The story has been known and reported for quite some time.

The "news" is that CNN is reporting this, that this is the slowest US recovery since WWII.

Considering not much happened before WWII -- with regard to the market -- except the 1929 crash -- one could say this has been the slowest recovery in modern US history, perhaps in US history, despite Krugman's and Bernanke's gazillions in helicopter money. I assume the helicopter money was sucked up by ObamaCare, Solyndra et al, and wind farms.

But then CNN goes on to try to "claw back" the facts. The headline says it all; after that it's all Clinton News Network.

The Apple Page

Now, even the replacement Samsun Galaxy Notes are catching on fire -- one on an airplane. From Macrumors:
Over the past few weeks, Samsung has been replacing recalled Galaxy Note 7 smartphones that have faulty exploding batteries with new devices, but an incident today suggests the South Korean company's smartphone woes aren't over.

A Southwest flight from Louisville to Baltimore was today evacuated just before it pulled out of the gate because a Samsung Galaxy Note 7 smartphone started smoking. While no one was injured, there is a serious problem -- the Galaxy Note 7 in question was a replacement device that had been deemed "safe" by Samsung.

According to The Verge, the owner of the Galaxy Note 7, Brian Green, had replaced his original Galaxy Note at an AT&T store on September 21. The smartphone had a green battery icon and box the device came in features a black square, both of which are indicators of a replacement Note 7.

CLR's Huge Whitman Well Was Off-Line All Of August, 2016 -- October 5, 2016

Taken off-line all of August, 2016, this well has produced almost 1.5 million bbls of oil since late 2011, only 5 years ago:
  • 20210, 803, CLR, Whitman 2-34H, Oakdale, Bakken, s1/11; t9/11; AL; cum 1.4676 million bbls 7/16; 24 stages; 2.4 million lbs; middle Bakken; runs south; 4 section spacing; this is an incredible well; still 19,000 bbls in October, 2015; off-line all of 8/16;
Production profile last few months:
PoolDateDaysBBLS OilRunsBBLS WaterMCF ProdMCF SoldVent/Flare

A sundry form dated March 12, 2016 showed that CLR installed a pump on this well on 3/12/16. Later, there is a sundry form received September 23, 2016, that a 20-bbl leak was noted and repaired; clean up was concluded March 15, 2015.

We're Gonna Need A Lot Of Wind Turbines By 2025 -- October 5, 2016

And, of course, all those wind farms will need to be backed up by natural gas power plants. LOL.

Office buildings with data centers use a lot more electricity than your mom-and-pop 7/11 convenience store. Just saying.

Missed It By That Much -- Investor's Business Daily; WTI Pushes Over $50 -- October 5, 2016

Price of WTI: I've always said it is a fool's errand to try to predict the price of oil. On October 3, 2016, just two days ago, I posted:
Link here. Despite OPEC "cut" -- US oil may not top $50 ceiling until next year -- Investor's Business Daily.

The LEGO Disney Castle Is Available Again

The Disney Castle was oversubscribed when it was first released. It was "temporarily" removed from the LEGO catalogue.

I linked the LEGO Disney Castle at the sidebar at the right at the very top. I checked it this morning, and lo and behold, it was available. I immediately went on-line but the site crashed. I immediately called "Customer Service" and got through to "Reuben" in Connecticut immediately. He said the site was crashing because the orders for this castle were coming in fast and furious.


I was able to order a Disney Castle.

All is right with the world.

No, it is not for me.

By the way, folks are buying this Castle and then "flipping" them for significantly higher prices on eBay.

White Christmas


1939 / 1943

The song that changed Christmas -- WSJ.

And then there are the DAPL protesters. Whatever. Some Americans have no idea how "fortunate" we are.

Dame Vera Lynn

GDP - 3Q16: Latest Forecast, Unchanged -- October 5, 2016

Latest forecast, GDP, 3Q16: 2.2 percent — October 5, 2016
The GDPNow model forecast for real GDP growth (seasonally adjusted annual rate) in the third quarter of 2016 is 2.2 percent on October 5, unchanged from October 3.
Following yesterday's (Tuesday's) auto sales release from the U.S. Bureau of Economic Analysis, this morning's (Wednesday's) M3 manufacturing report from the U.S. Census Bureau, and this morning's Non-Manufacturing Report On Business from the Institute for Supply Management, the forecast of third-quarter real consumer spending growth increased from 2.7 percent to 2.9 percent and the forecast of third-quarter real equipment investment growth increased from –2.0 percent to 0.0 percent.
The forecast of the contribution of net exports to third-quarter growth fell from 0.13 percentage points to –0.13 percentage points after this morning's international trade release from the U.S. Census Bureau.

Curb Your Enthusiasm: The Rise In The Price Of Oil May Be Temporary -- October 5, 2016

Curb your enthusiasm: the recent rise in the price of oil may simply be due to Hurricane Matthew. Once the storm passes, we will see where the price of oil lands.

Not product placement: I normally don't do this, but I think it's worth reminding folks, especially if you have children. The Disney Mickey Mouse waffle maker is superb. I assume there are similar (and probably even better) models out there. But it is so incredibly easy and so quick to make Bisquick waffles, and they are so incredibly delicious. I can literally have a complete batch done by the time my coffee has brewed. (I give the waffle make a head-start; I don't start the coffee until the first batter is poured on the waffle maker.) I wash all dishes as I go along. I don't get out the electric mixer; I just use a hand-driven whisk.

The Bisquick recipe calls for 1 1/2 cups of milk and one egg. I use only 1 cup of milk (because I'm usually low on milk -- it always catches me by surprise) and add a second egg.

Iran: The Big Winner -- Bloomberg

Agree: Iran is the big winner. After getting the concessions it needed from Saudi Arabia:
  • Iran signed a new-model oil investment contract
  • $2.2 billion deal with Persia Oil * Gas Industry Development Co to boost output at three fields
  • a second contract will be signed later today (Wednesday) -- no details
  • the "new type" of contract is designed to better reward investment in oil and gas production
  • it may take a few years for results to be known
  • nothing was said about waffles in the Bloomberg story
First, The US Gulf of Mexico; Now The North Sea

BP's UK oil field Clair is still shut following a leak at sea.
  • began October 2, 2016; up near Scotland
  • won't start back up until "completely certain" the technical issue is resolved
  • about 700 bbls released into the sea
  • compares with 4 million bbls in the Gulf of Mexico in 2010

Dismal Jobs Report -- USA Today -- October 5, 2016

Forget Cuba. The new frontier: Iran.
  • WSJ link
  • Europeans are way ahead of the US on this one, but the US will catch up
Flashback I: On October 3, 2016, two days ago, writing about the "OPEC cut" I said:
If there are hints that the downtown might be ending (in other words, that the price of oil is going to rise), one can count on Goldman Sachs to try to talk it "down."
Today, lead story over at Yahoo!Finance: "wall of supply" will block oil rally at $55, says Goldman Sachs.

Flashback II: yesterday I mentioned Amazon Prime -- always adding a few more perks for subscribers. Today, it is being reported that Amazon Prime subscribers will have free access to a number of ebooks and e-magazines. Some reports suggest that the list is limited, but, in fact, the list is quite impressive, to include Sports Illustrated (including the annual swimsuit edition), Popular Mechanics and National Geographic Traveler, just to name a few.  "Prime Reading" can be accessed here.

Jobs. Remember the "magic numbers. From USA Today --
The private sector added 154,000 jobs in September, processor ADP said Wednesday, fueling speculation that the government this week will report a second straight month of tepid employment growth.
Economists expected ADP to report 163,000 job gains. They expect the Labor Department’s closely watched survey, out Friday, to tally 174,000 additional jobs in the public and private sectors.
New jobs: 200,000 (< 200,000 new jobs: economic stagnation).
Bankruptcy. No links. Story everywhere. Tex-Mex chain files for Chapter 11.
  • Rita's Restaurant, owner of Tex-Mex restaurant chain Don Pablo's Mexican Kitchen files for bankruptcy
  • San Antonio-based
  • cites downturn in causal-dining business
  • cites increased competition from 'fast-casual' Mexican-food brands (like Taco Cabana? LOL)
Back to the Bakken

Active rigs:

Active Rigs3267190183190

RBN Energy: RBN Energy looks at fifteen diversified E & Ps -- CAPEX and production. The companies: Andarko, Bill Barrett, Cimarex Energy, COP, Devon, Encana, Freeport McMoran, Newfield, Noble, QEP, SM Energy, Vanguard Natural Resources, Unit Corp, W&T Offshore, and WPX.

At least five of these companies operate in the Bakken. The WPX is most surprising.

The Market

The close: up 104 points; WTI at $50.29.

Mid-afternoon: Dow 30 up 126 points. NYSE:
  • new highs: 193 -- CNOOC; CAT; CLR (a big whoop); EOG (a huge whoop); Encana;
  • new lows: 14
Opening. Dow 30 up 115 points. Apparently the "big boys" took their profits yesterday and are now buying back in. What's WFC doing? Up almost 3% and back near $45. Warren Buffett will sit this one out; he knows how things always blow over.